Thursday, 27 February 2014

OSA ruling: no Czech exemption from health-spa music royalty payments

Today was the day that the Court of Justice of the European Union (CJEU) gave judgment in Case C‑351/12, OSA – Ochranný svaz autorský pro práva k dílům hudebním o.s. v Léčebné lázně Mariánské Lázně a.s., a reference for a preliminary issue from a Czech court, the Krajský soud v Plzni. This case has already been eloquently and elegantly explained by Eleonora on the IPKat weblog, here, so I shall content myself with reproducing the Cura press release and adding the occasional comment. According to the press release:
A spa which transmits protected musical works to its guests by means of devices located in their bedrooms must pay copyright fees

The territorial monopoly granted to copyright collecting societies is not contrary to the freedom to provide services

OSA, a copyright collecting society, holds the exclusive right in the Czech Republic to collect fees, on behalf of authors, for the use of their musical works. The company Léčebné lázně Mariánské Lázně, which manages a spa, installed radio and television sets in the bedrooms of that establishment in order to make works managed by OSA available to its guests. However, Léčebné lázně Mariánské Lázně did not enter into a licence agreement with OSA and refused to pay fees to it on the ground that, under the Czech legislation, health establishments may freely transmit protected works. OSA, being of the view that the national legislation is contrary to the EU Copyright Directive, brought an action before the Czech courts claiming that Léčebné lázně Mariánské Lázně should be ordered to pay fees for having made protected works available to its guests.

The Krajský soud v Plzni (Plzeň Regional Court, Czech Republic) asked the Court of Justice whether the Czech legislation under which health establishments are exempt from the payment of copyright fees is in accordance with the directive, inasmuch as that directive does not provide for an exemption of that kind. The Czech court also wishes to know whether OSA’s monopoly over the collection of fees in the Czech Republic is compatible with the freedom to provide services and with competition law.

By its judgment delivered today, the Court points out, first, that by transmitting protected works by means of television and radio sets located in the bedrooms of its guests, a spa carries out a communication to the public of those works. Such a communication must be authorised by the authors, who must, in principle, receive adequate compensation.

In that respect, the Court notes that the directive does not exempt a spa from the payment of fees where it transmits protected works to its guests. Consequently, the exemption laid down by the Czech legislation does not comply with the directive [It's difficult to see how the CJEU could have credibly reached any other conclusion on this point].

Secondly, the Court notes that the territorial monopoly granted to OSA constitutes a restriction on the freedom to provide services inasmuch as it does not allow users of protected works to choose the services of a collecting society established in another Member State. The Court emphasises however that the restriction in question is justified, since that system is appropriate and necessary for attaining the objective of the effective management of intellectual property rights. As EU law stands at present, there is no other method allowing the same level of copyright protection [despite dreams that have been entertained from time to time of a "perfect world" in which competing collecting societies continue to undercut each other until the copyright owners are assured of the closest sum to zero that the market will allow them ...]. The Court therefore concludes that the monopoly granted by the Czech legislation to OSA is compatible with the freedom to provide services.

The Court notes, however, that the imposition by a national copyright collecting society of fees which are appreciably higher than those charged in other Member States or the imposition of prices which are excessive in relation to the economic value of the service provided is indicative of an abuse of a dominant position [this is an interesting topic: "appreciably higher" can be measured in percentage terms or absolute terms, obtaining quite different results -- and "excessive in relation to the economic value of the service provided" is a phrase that screams "litigate me!"]. Nevertheless, it is for the Czech court to examine whether such a situation exists in the present case.

IPO contribution to EU Copyright Consultation

The UK Government, in the form of the IPO, has published their contribution to the EU Copyright Consultation here.  You still have time to change your own submission in response before 5 March.

As Eleonora reviews on the IPKat in beautiful detail the key aspects of this response, it seems unnecessary to do the same, so this blogger will confine himself to a couple of comments:

  • It is blessedly short - bearing in mind the length of the consultation itself, the IPO is to be commended at creating a response that is only 10 pages long (although no doubt the Commission will be disappointed that the UK chose to ignore their convoluted structured approach to the questionnaire.
  • Within those 10 pages, a surprisingly few are devoted to what industry might see as the more significant issues - for example, cross-border portability merits only two paragraphs (including a cross reference to an earlier government response on another consultation), while exceptions around teaching merit nearly a page.
  • The most surprising position is that, in relation to digital resale, the UK position is "There seems to be no reason why [resale and a secondary market] should not be the case for digital copies, except for the “forward and delete” issue noted by the consultation."  The UK government wants to make sure that this is introduced in a way that allows it to be priced into the original sale/licence, but seems to accept the principle of digital resale. 

Tuesday, 25 February 2014

The way forward to the Collective Rights Management Directive

Sebastian Felix Schwemer
As reported by the IPKat, a few days ago the Council formally adopted a new directive on “collective management of copyright related rights and multi-territorial licensing of rights in musical works for online uses in the internal market [the 'CRM Directive'].

What is this new directive all about? Is there anything in it besides its never-ending title?

Yes, says 1709 Blog friend Sebastian Felix Schwemer (Centre for Information and Innovation Law, University of Copenhagen), who so writes:

"Last Thursday the Council adopted the CRM Directive. This followed a vote by the European Parliament (with a rather impressive majority of 640 of 680 votes) just two weeks prior to the Council’s adoption and an informal trialogue agreement in November 2013.

The Directive pursues two main objectives:

1) To increase transparency and efficiency in the functioning of collective management organisations (CMOs), and
2) To facilitate the granting of cross-border licensing of authors’ rights in the online music vertical.

As early as 1995 the Commission had collective management on their legislative agenda. The new Directive, however, represents the first EU intervention in the area of collective rights management, as well as the way the relevant organisations operate. 

Initially expected in 2010, the Commission proposed its draft directive in July 2012 [see here and here], as a key action of the Digital Agenda for Europe.

Will CMOs become so transparent ...
The first draft was significantly expanded and the CRM Directive is now composed of 58 recitals and 45 articles plus an annex covering reporting duties.

The main elements of the new rules have been summarised [and emphasised] by Commissioner Barnier as follows:

(1)  Clear description of rightholders’ rights; including their free choice of a collective management organisation and of the scope of authorisation (rights, categories of rights and types of works of their choice; territories of their choice);

(2)  Minimum requirements relating to a collective management organisation’s governance structureeg the obligation on the collective management organisation to have a supervisory function to supervise management, provisions relating to voting rights of rightholders and their rights to give a proxy to a representative to exercise their right to vote at the general assembly;

(3)  Time limits regarding the payment made to rightholders by a collective management organisation 
[9 months], as well as rules regarding the use of the amounts which cannot be distributed;

(4)  Rules regarding the relation with users and criteria for setting up tariffs;

(5)  Transparency requirements towards rightholders, other collective management organisations, users and the public;

(6)  Establishment of criteria a collective management organisation has to fulfil to grant multi-territorial licenses for authors’ rights in musical works for online use;

(7)  Rules on representation agreements between collective management organisations for the purposes of multi-territorial licensing, in particular criteria for when a collective management organisation has an obligation to represent another organisation;

(8)   Provisions on dispute resolution, such as an alternative dispute resolution procedure for certain disputes relating to multi-territorial licensing.

The first objective, ie to increase transparency and efficiency in the functioning of CMOs, is addressed in the general provisions on collective rights management for all sectors and contains a governance and transparency framework. The Commission opted for the codification of the existing principles established in case law in conjunction with a “more elaborate framework on governance and transparency”, as pointed out in its explanatory memorandum.

One aspect discussed in the legislative process has been the scope of the Directive. While the initial draft referred to “collecting societies”, the Directive is now aimed at “collective management organisations”. The more general term was preferred to ensure the establishment of a level playing field.

A noteworthy provision that has been added during the legislative process is the possibility (Article 5(3)) for rightholders to grant licenses for non-commercial purposes (such as Creative Commons licenses).

The second objective of the CRM Directive, ie to facilitate the granting of cross-border licensing of authors’ rights in the online music vertical, is addressed through the establishment of a passport model, by which collective management organisations that satisfy certain minimum requirements are enabled to license authors’ online rights in musical works on a multi-territorial basis. This is not limited to downloading or streaming services only but also covers use of music in games or audio-visual content. This vertical approach has been criticised, amongst others, by the Max Planck Institute [here and here].

The new rules on multi-territorial licensing are not only expected to facilitate
... that it will be almost scary?
 new online services – and thereby enhance consumer choice – but also lead to a reduction in transaction costs, which should be passed on to consumers (or so recital 44 says).

Poland does not seem convinced that music service providers are “interested in acquiring licenses for multi-repertoire and multiterritorial coverage”. Pointing towards the potential detrimental effect on cultural diversity and the fact that service providers face a multitude of other challenges in offering pan-European services, this country abstained from voting in the Council.

It will be interesting to see to what extent the CRM Directive will achieve its goals. While this is a way forward for multi-territorial online music licensing, it is unlikely that this approach would be one-size-fits-all for other entertainment verticals. One might argue (indeed many have) that the earlier (and softer) measures such as the 2005 Recommendation and competition case law have increased fragmentation in the internal market (where we have not only mono-territorial licensing by collecting societies but also pan-European licensing of mono-repertoires).

During his speech in front of the Parliament on 4 February, Commissioner Barnier underlined that it is important that “CMOs, rightholders and users take ownership of the instrument”.

Member States will have to incorporate the provisions into domestic law no later than 24 months after its entry into force. When releasing its proposal, the Commission made it clear that the new rules would lead to “substantial changes” in most national laws. So: May the implementation games begin!”

Canadian court reviews the threat of copyright trolls

The Canadian media featured extensive coverage over the weekend of the federal court decision in Voltage Pictures LLC v John Doe and Jane Doe (2014 FC 161) which, whilst opening the possibility of ISPs being required to disclose the names and addresses of thousands of allegedly infringing subscribers, also establishes new safeguards against copyright trolling in Canada and balanced the interests of copyright owners against the right of privacy. While some commentators focused on the copyright trolling issues, others emphasized the disclosure of the names and the possibility of lawsuits. The Court prefaced their decision saying 

"the rise of so-called' copyright trolls' - plaintiffs who file multitudes of lawsuits solely to extort swift settlements - requires the court to ensure that the litigation process and their scarce resources are not being abused" 

and noted that other jurisdictions had focussed on the problems trolls pose - and had come up with solutions such as requiring -pre-action letters to be clear and fair - and submitted to the court. Judge Kevin Aalto identified five factors to be looked at:

- the plaintiff must have a bona fide case
- another party must have information pertinent to the case (eg personal details of subscribers)
- a court order is the only reasonable way of obtaining this information
- that fairness requires the information to be provided before thr trial
- any order will not cause undue delay, inconvenience or expense to the third party or others

There is also a comprehensive review of Canadian case law;  the position in the UK with the 1974 decision by the House of Lord in Norwich Pharmacal is analysed along with the recent application in Rugby Football Union v Consolidated Information Services [2013] 1 All ER 928 - and in particular a very interesting take on Judge (now Mr Justice) Colin Birss's approach in the Media CAT cases, and Mr Justice Arnold's decision in Golden Eye (International) Ltd et al v Telefonica in 2012 - both of which the Canadian court found were helpful guidance. The Canadian court also looked to the US and again at their position on copyright trolls, and concluded "the decisions reviewed suggest that the courts in both the UK and U.S. are particularly concerned with sanctioning a business model which coerces innocent innocent people into settlements" and that courts in both jurisdictions are open to imposing safeguards - and that the person identified by an ISP may not be the alleged infringer in all events - summarising (at page 53) a non exhaustive list of fourteen considerations for Canadian courts in cases such as the Voltage Pictures claim. Whilst the Canadian court ruled that ISP TekSavvy would have to hand over the personal data of roughly 2,000 customers who had obtained copies of Voltage films The Hurt Locker," "Dallas Buyers Club," and "Don Jon" Judge Aalto also said

"In order to ensure there is no inappropriate language in any demand letter sent to the alleged infringers, the draft demand letter will be provided to the court for review"  adding  "Any correspondence sent by Voltage to any subscriber shall clearly state in bold type that no court has yet made a determination that such subscriber has infringed or is liable in any way for payment of damages."

The court also required that any subscriber must be able to request a full copy of the Judge's order, which Voltage will have to pay for. TekSavvy's legal bills and costs must also be paid in full before any information is exchanged,

Friday, 21 February 2014

The CopyKat - funny, but it's still all about the money, honey.

A new study by the European Commission shows that 70% of Europeans are regularly downloading and streaming film content for free on the net. The survey of 4,608 consumers covers both legal and illegal streaming, and 97% of those surveyed said they watched films at least occasionally, and 68% said they accessed free movie content online, 34% on a weekly basis - much of which is presumed to be currently from illegal platforms. The report says: "The high cost of cinema or legal platforms is a key motivation for free downloading and streaming. 50% of respondents admit streaming and downloading films online for free because 'cinema tickets, video-on-demand and DVD are expensive and they can't afford them for all the films they want to see' and 37% think 'some films are interesting but not worth paying for the cinema experience'". It goes on: "Other reasons for streaming and downloading films for free include ease of access (31% of downloaders consider that 'many films are available online and don't see the point in paying'), lack of availability (30% say that 'many films they want to see are not available in their country' and 27% that 'many films they want to see are too slow to come to their country') and missed opportunities (28% say that 'they didn't go when the film was on the cinema and they can't wait for it to be available on DVD or on TV' and 23% say they 'don't have time to go to the cinema')".

US consumer group the Digital Citizens Alliance, has released a report of research by MediaLink surveying 596 piracy sites and estimates that together those sites are generating about $227 million a year in advertising revenues, with the top 30 sites bringing in around $4.4 million each. And because these sites have relatively few running costs, certainly no royalty payments for either sound recordings or music rights, or payments to film companies or other broadcasters, the DCA calculates that these operations could be operating at an 80% to 94% profit margin. The DCA is a "consumer-oriented coalition focused on educating the public and policy makers on the threats that consumers face on the Internet and the importance for Internet stakeholders – individuals, government and industry - to make the Web a safer place."

She may have won the battle of the T-shirts against Topshop, but Rihanna's 'S&M' 2011 music video has prompted claims from two photographers that the video steals from their work. The first claimant is celebrity photographer, David LaChapelle, while German photographer Philipp Paulus first made his allegations in June 2011. Paulus is now going legal, claiming that Rihanna's label Universal Music has failed to properly respond to his complaint. Paulus's claim focuses on a repeated sequence in the vdieo where the singer is wearing oversized dress and stands up against a plastic sheet surrounded by Xs.Universal has admitted the similarities that exist between the video and the photographer's work. Paulus said: "It is shocking that a company like Universal Music, which generates its turnover with intellectual property, copies the intellectual property [of others] completely unauthorised and without respect".

Warner Music has launched website to explain it's proposed digital royalties settlement in response to a class action lawsuit brought by a number of heritage artistes who want a fair share of digital music revenue: Artists with pre-iTunes record contracts argue that they should be paid a bigger cut of the revenue generated from downloads, because such income stems from licensing deals between the labels and the digital firms, and a traditional record contract pays a bigger cut to artists on licensing income versus record sales - usually half of such income after fixed costs rather  than a 'per unit' royalty that would be reduced by contractual terms as well as fixed deductions. In the FBT (Eminen) decision - the US appellate court agreed. Warners unveiled its proposed settlement late last year, offering to increase future download pay outs to artists by up to 5% with a 14% cap. BUT - its still a 'per unit sold' royalty. The major also said it would set aside $11.5 million to provide artists with some extra payments related to past download sales as well as some legal fees. A statement issued announcing the site states that "Warner Music Group denies any wrongdoing" in the way it has paid out digital royalties to artists in the past. A statement from Warner's attorneys also notes "[Eligible artists] who want to keep the right to sue Warner Music Group must exclude themselves from [this] settlement by 31 May 2014. People who stay in the settlement may object to it by 31 May 2014. People who do not exclude themselves or who do nothing will be bound by the court's decisions". Personally - the label's maths doesn't work  - the profit margin for digital downloads (and streaming) is huge - if I was an artist I would want my half share of revenues. Full stop.  More at

In Russia, the operator of a stream aggregator called Tracks Flow is facing a fine and possible web-blocking actions over copyright infringement claims. The site, which pulls in streams from a plethora of sources but allows users to listen to and organise tracks through one web-based interface, was targeted with litigation by now Warner affiliate SBA Music Publishing. According to Torrentfreak, the Moscow Arbitration Court has sided with the publisher, ordering TracksFlow and its owner Boris Golikov to pay over $44,000 in damages and ruling that the domain should be "terminated" and given the dotcom registry sits outside the jurisdiction of the Russian courts, judges may issue web-block injunctions against internet service providers in the country, similar to those issued by various other European courts, including in the UK.

A Utah judge has blocked TV streaming company Aereo from operating in several Western states, at least until the U.S. Supreme Court takes up a related case in April. District Judge Dale Kimball ruled that Aereo's retransmission of video signals is "indistinguishable from a cable company." He said that if Aereo continued to do business, it would damage broadcasters' ability to negotiate with legitimate licensees, siphon viewers away from their websites and subject them to potential piracy. The U.S. Supreme Court, which will begin hearing arguments in the Aereo case on April 22, will aim to resolve different rulings in different districts including Kimball's court which goes against the decision of the 2nd District Court of Appeals, which covers New York, Connecticut and Vermont, which held that Aereo was not violating copyrights.

More from Russia: Anton Yelesin, the owner of the file hosting website, has received a two-year suspended sentence after pleading guilty to  “intentional large-scale violation of copyright law”. The sentence was handed down by a court in Tatarstan’s second largest city Naberezhnye Chelny, after Yelesin pleaded guilty. According to the Russian newspaper Kommersant this is the first guilty verdict in a case of online copyright infringement. Over on the IPKat  there is a guest post by IP attorney and blogger Lucas Michels, who brings us up to date with a topic that is very much in our minds these days -- the enforcement of copyright against digital exploitation on the internet in Russia and the hurdles facing Russia’s leading publishing houses, Eksmo, who have filed a copyright infringement lawsuit against Russia’s largest social media site, VKontakte.

The full conference programme for the IP Protect exhibition and  convention at the Business Design Centre in London on March 11th and 12th has been launched. Day 1 focusses on "Generating and protecting the value of your creative ideas - the basics of intellectual property and beyond" and speakers include Gary Townley, Business Outreach Manager, IPO, Matthew Lumb, Chief Operating Officer, Tangle Teezeron and Claire Lyons, Corporate Counsel EMEA, OtterBox all on  "Generating value from your creative ideas (a seminar for SMEs)", John Hodge, Head of Internet Investigations, BPI and Eddy Leviten, Director of Communications, FACT (Federation Against Copyright Theft) take on "Industry cooperation – the protection of digital content", Neil Boyd, Senior European Anti-Piracy Counsel, Nintendo of Europe GmbH talks on "Copyright protection in the UK and abroad – the Super Mario story" and the 1709 Blog's Ben Challis is giving a talk titled "Fit for purpose? Revising copyright laws in the digital age". Day 2 highlights "Meeting the challenges of the international market place – the intellectual property  response" and features, amongst others, Jason Drangel and Ashley Sands from Epstein Drangel LLP on "Anti-Counterfeiting Programs in the U.S.: The Angry Birds Case Study", Per Strӧmbäck – Editor, Netopia speaks about "3D printing and intellectual property – challenges, market and policy disruption" and there is a live telephone link with the IP attaches in China and Singapore – so you can ask questions about China and South East Asia! You can visit the exhibition and participate in the sponsored workshop sessions and table top discussion completely free of charge. More on tickets for attending the conference and participating for one or two days here

Thursday, 20 February 2014

"Are moral rights human rights?"

For a British moral rights
cause célèbre, click here
"Are moral rights human rights?" was the title of last week's joint meeting between the British Literary and Artistic Copyright Association (BLACA) and the IPKat weblog, which was kindly hosted in the London office of law firm Bird & Bird.  Sir Colin Birss was in the chair.  The PowerPoints of the two speakers are now available from the BLACA website, here.   The two presentations were made by Cyberleagle Graham Smith (an IP/IT partner, Bird & Bird) and the IPKat's Eleonora Rosati, who is also a major contributor to the 1709 Blog.

Although the title sounds quite narrow, the content of the event inevitably spilled over quite a bit from moral rights into the adjacent copyright field of economic rights, so the presentations are of wider interest than you might immediately imagine.

For a British human rightscause célèbre, click here
Apart from two thoroughly lively and entertaining presentations and the cut-and-thrust of the questions and answers which followed them, there was also the promise of more to come in terms of establishing the balance between the two doctrines.  In front of a roomful of credible witnesses, Sir Colin said -- in all apparent sincerity and with a perfectly straight face -- how very much he was looking forward to trying a copyright action in which a human rights defence was raised.  This blogger hopes that it will not be long before this wish is fulfilled.

Wednesday, 19 February 2014

Non-copying alterations under UK law: a paradoxical result?

"Assuming that the Mona Lisa painting was still protected by copyright and was so under UK law, would it be an infringement for me to draw a moustache on it (that is, on the original - so that the issue of me making a copy doesn't arise)?"

This is the question that a 1709 Blog friend writing under the nom de plume of Leonardo [of course: what else?] wishes to pose to this Blog's readers.

"I can see" - continues Leonardo - "that under say: US copyright law, one might argue that the altered painting was a derivative work, hence the drawing of the moustache would be arguably an infringing preparation of a derivative work. But the adaptation right under the Copyright Designs Patents Act 1988 (CDPA) does not extend to artistic works. So, it might be vandalism, it might be an infringement of the artist's moral rights, but I can't see how it would be an infringement of copyright per se. Is there something I'm missing?"

Among other things, Section 21(1) CDPA provides that "The making of an adaptation of the work is an act restricted by the copyright in a literary, dramatic or musical work", thus seemingly excluding artistic works from its scope.

As such, this blogger reckons that Leonardo may be indeed right. If anything copyright-related, could this be just a case of moral rights (notably: right of integrity) infringement? 

Another question that comes to mind may be: Is the author of the mustache entitled to copyright protection over the resulting work? The addition could be deemed sufficiently original (surely, it is adding a 'personal touch') for the sake of copyright protection. Might this mean that Leonardo da Vinci would have to obtain the permission of the mustache-adder should he wish to sell the work?

That would be rather a paradoxical result, but what do readers think? Can anyone help Leonardo?

Star Wars at London Fashion Week

As we all know, Stormtrooper helmets are neither works of artistic craftsmanship nor are they sculptures, therefore are not protected by copyright (see here). Their presence backstage at the Preen's London Fashion Week show is therefore not something that Disney, owner of the Star Wars franchise, is likely to be able to do anything about.

Rodarte on the left; Preen on the right
Preen took the Star Wars theme a step further however, as their collection includes a series of dresses featuring Darth Vader. Similarly, at New York Fashion Week, Rodarte's collection included silk dresses featuring Luke Skywalker and C3P0 prints. Preen and Rodarte may be licensed by Disney, however if they are not they could be in hot water: Rihanna famously succeeded in stopping Topshop from selling t-shirts with her image on them by claiming passing off (see here), however if Disney own copyright in the Darth Vader, Luke Skywalker and other images its claim could be more straightforward.

Disney is fiercely protective of its brand; given that Preen's show in particular coincides with  Disney's release of teasers for a new animated series, Star Wars Rebels (which documents the early days of the rebellion against the Empire), this blogger wonders whether this a case of clever advertising or a copyright claim waiting to happen?

Tuesday, 18 February 2014

Australia's copyright reform agenda: exceptions, graduated response & site blocking?

At the Australian Digital Alliance's annual Forum last Friday (disclosure: this blogger is an ADA board director), Attorney-General Senator the Hon George Brandis gave a wide-ranging speech that covered some of the recommendations proposed in the ALRC Report (which we discussed here) as well as other copyright policy concerns.

The Attorney-General argued that 'the fundamental purpose of copyright' is 'to ensure that those who take on the risks of creation are appropriately rewarded for their abilities and efforts.' He reiterated his long-held belief that 'the fundamental principles of copyright law, the protection of rights of creators and owners, did not change with the advent of the internet and they will not change with the invention of new technologies', and promised to continue supporting creative industries via strong copyright protection. Against that backdrop, he then acknowledged that reform is needed, and committed to a 'thorough and exhaustive' review of the Copyright Act.

In addition to these general remarks, the Attorney had some specific comments to make with regard to a number of controversial reforms, including exceptions, ISP copyright policing and site-blocking:

Exceptions - As recently discussed, the Australian Law Reform Commission last week recommended that Australia introduce a flexible 'fair use' style copyright exception. The Attorney observed that he 'remain[s] to be persuaded' that a flexible fair use style exception is the best direction for Australia, but committed bringing an open and inquiring mind to that debate.

ISP copyright policing - the Attorney stated that:
The Government will be considering possible mechanisms to provide a ‘legal incentive’ for an internet service provider to cooperate with copyright owners in preventing infringement on their systems and networks.
This may include looking carefully at the merits of a scheme whereby ISPs are required to issue graduated warnings to consumers who are using websites to facilitate piracy. 

This is a complex reform proposal, and how it is paid for is one of the principal unresolved issues.

It should also be noted that Australia has international obligations on this point and that the Government will not be seeking to burden ISPs beyond what is reasonably necessary to comply appropriate domestic and international obligations. 

As well, I would like to emphasise that this would not put Australian ISPs at a disadvantage by comparison with their counterparts internationally as many overseas jurisdictions have the concept of authorisation liability, secondary liability or similar, which are intended to capture ISPs.
Site-blocking - the Attorney also mentioned that stakeholders have requested new takedown powers which would 'ultimately require ISPs to "take down" websites hosting infringing content.'

A self regulatory approach? Site blocking and graduated response measures might be unpalatable to some voters, but legislation may be avoided: Senator Brandis stated a preference for these enforcement reforms to involve industry self-regulation rather than government regulation.

The full text of the Attorney-General's speech is available here (pdf). We'll keep you informed as the debate continues.

Sunday, 16 February 2014

Copynorms survey: a progress report

This blogger's first copying experience
came from a Grundig 
just like this ...
Just a few days ago, the 1709 Blog posted this appeal to its readers to participate in the survey, "Copy, share and remix, what is okay?", which Francis Davey is making of people's attitudes to copying (so-called "copynorms").  Francis has already blogged about his survey at greater length here and has addressed some of the comments made by respondents here.  Responses to our call for support have been tremendous and Francis now has over 800 responses to the survey, which you can access here.

Do please participate -- and pass the link on to your friends and colleagues. It would be great to push the total number of respondents well above the 1,000 mark.

Friday, 14 February 2014

Hyperlinks, making available and the 'new public' -- or just a dead end?

Here's a provocative piece from Pekka Savola (@PekkaSavola, Legal Counsel at CSC-Scientific Computing Ltd and a researcher at University of Helsinki, Finland. Pekka has 15 years of technical background in internet working, including a degree of Licentiate of Science (Technology). He also has a Master of Laws degree and is currently putting the finishing touches to a doctoral thesis on using ISPs as a copyright enforcement mechanism. Pekka also has an article discussing hyperlinking from a blocking injunction perspective pending publication in EIPR.   This is what he has to say:
Did the CJEU just turn to a dead end in hyperlinking with Svensson? 
The Svensson ruling: much anticipated and discussed 
the CJEU judgment in Svensson (C-466/12) of 13 February 2014 ruled that a clickable hyperlink (as well as a framing link) to an authorized publicly available work does not infringe the communication to the public right because the public is not new. 
The answer to the referral questions had been widely speculated and advocated in a number of papers, including at least (plus numerous blog entries and other commentaries):
·         European Copyright Society Opinion on the Reference to the CJEU in Case C-466/12 Svensson (15.2.2013) 
·         ALAI Report and Opinion on the making available and communication to the public in the internet environment – focus on linking techniques on the internet (16.9.2013), also published in (2014) 36(3) EIPR 149. 
·         Jane C. Ginsburg: Hyperlinking and "making available", a comment on the ALAI report, published in (2014) 36(3) EIPR 147. 
·         Alexander Tsoutsanis: "Why Copyright and linking can tango" (prepublished online on 3.2.2014, to be published in JIPLP) 
·         Jeremy de Beer and Mira Burri: Transatlantic comparisons: making available via hyperlinks in the European Union and Canada, published in (2014) 36(2) EIPR 95. 
Essentially the ALAI report, Ginsburg and Tsoutsanis advocated that hyperlinking can, as a form of making available, be infringing. The first two do not address the 'new' public and they start off from prima facie infringement. The biggest problem is trying to distinguish linking to web pages and linking to protected files. They fail to see that web pages are also protected works and technically 'files', and that a broad application leads to absurd situations that cannot be mitigated by copyright exceptions (at least in EU). Tsoutsanis used the new public criterion as a form of flexibility, although he had a more critical approach to framing links compared to the Svensson ruling. The ECS opinion failed to address 'making available' at all, and the last one barely touches on it. These two took a much more liberal stance. 
The CJEU's approach builds on the making available right, but leverages the new public requirement as the safety net. Is this good news? It is a relief against the backdrop of the ALAI opinion. That is, the ruling could have been worse. In the short term it might also be sufficient. But in the long term, the grounds appear to be worrisome. Particularly disappointing is the failure of the CJEU to substantiate why hyperlinking is 'making available'. 
The can of worms opened by Svensson 
CJEU issued its Svensson judgment without the opinion of an Advocate General. This is unfortunate, as an AG's opinion would likely have provided more research and contemplation on the implications of the decision. This would have been helpful for subsequent rulings. 
What are the loose ends opened by Svensson? I will name a few; there are others. 
1.      Hyperlinking is considered making available through 'providing direct access to works' so that the public may 'access [the work]' without any real substantiation (paragraphs 18–20). This is a dead-end for the argument that hyperlinking acts as a mere indication of (easily accessible) source. 
2.      'New public' is dependent on what the original author took into account (para. 24). This may lead to issues where the author's intention, ie. a mental element, must be examined. Luckily, the CJEU stated affirmatively that the intention is given when the work is published openly on the internet (para. 27). 
3.      The ruling only addresses scenarios where the initial communication to the public has occurred with the author's authorization. E contrario this line of argument would seem to strongly imply that the 'new public' criteria would always be met and result in infringement when the source is unauthorized or illegal. However, the linker cannot know if the target page or resource has been communicated to the public with or without authorization (and by whom). As such linking might later turn out to be illegal unless this would apply only to obviously unauthorized sources. (Martin Husovec also notes that authorized communication to the public is at least in theory narrower concept than legal publication eg. due to a copyright exception.) 
4.      Circumventing the restrictions is not discussed adequately (in para. 31). I suppose that the CJEU wanted to defer the argumentation to the pending referrals, especially C More Entertainment (C-273/13). It should be required that restrictions must be efficient enough. (Circumventing restrictions sounds a bit circular, doesn't it?) Most reasonable and efficient restrictions cannot be circumvented by linking, though they could be with other means, eg cookies. The exception are where the authorization token is included in the URL, but those are not very interesting from this perspective. Linking must not be deemed infringing by accident. For example, a stable link to an article behind a paywall should still be OK as a neutral reference; it should be the original author's responsibility to ensure that the restrictions work. 
5.      The judgment seems to imply (in para 31) that the author may later withdraw authorization by removing the work or restricting access to it. The former is an easy case, as no infringement could, it is hoped, occur due to referring to something that no longer exists. The latter could lead to problems if interpreted in such a fashion that a formerly legal link would transform to an illegal link through the acts of the author (e.g. if a disclaimer or a restriction that would not break existing links was sufficient). Suffice it to say that such withdrawal of authorization must be done so that previously legal links would stay legal by ceasing to work. 
6.      The judgment keeps repeating clickable links, even though that detail is irrelevant in the argumentation chosen. Superficially embedded links would not be covered. The arguments would seem to apply to those as well, however. 
Essentially the judgment was based on the new public safeguard which will fail in some cases. Taking for granted that hyperlinking as such is 'making available' of a work seems shortsighted. It may be difficult for CJEU to later rule – if (or when) 'new public' approach comes to a dead-end – that hyperlinking in fact is more like a reference, not providing direct access to the work. In my view, hyperlinking could be considered (at most) indirect making available of a work. 
The party who makes the work directly available (ie. offers it to the public) as originally contemplated in the WIPO Copyright Treaty is the person who puts the work on to a server, from which a member of the public may access it. There is has been no serious substantiation to the allegations that merely providing a reference to a work or (at most) indirectly making it available through a hyperlink (eg to a webpage) should or must be interpreted to fall within Art 3(1) of the InfoSoc Directive. While such an interpretation is possible, such a blanket statement would be unfortunate and a more nuanced analysis would be needed. 
Why did the CJEU not ask for an AG's opinion that might have discovered these loose ends and avoided the pitfalls in advance? Maybe the solution seemed very simple. As H. L. Mencken said, “For every complex problem there is an answer that is clear, simple, and wrong.” The CJEU apparently failed to think of the implications the line of argumentation would have. 
Let us hope a way out will be found.

Thursday, 13 February 2014

The CopyKat

You will probably remember the fact that 'Happy Birthday to You” is now the subject of a lawsuit brought against the publishing arm of Warner Music Group, which claims copyright ownership in the song, which was registered in 1935. The complaint, from a disgruntled film producer who had to cough up $1,500 to use the track, was filed in federal court in Manhattan and claims that “Happy Birthday to You” has been in the public domain since at least 1921. The suit seeks class action status on behalf of anyone who paid a royalty to use “Happy Birthday to You” in the past four years. The song allegedly generates at least $2 million a year in licensing fees for Warner/Chappell Music, Inc. In their last filing, the plaintiffs  claimed that the words were published in a variety of formats pre-1935, going back to 1893.  Well, Warners have now filed a status update which offers the first glimpse of some of the defences Warner may use. In it's brief statement, Warner's lawyers explain it's on the plaintiffs to prove that the 1935 copyright registration "was not intended to cover the lyrics to Happy Birthday to You" saying: "Certificate E51990 applies on its face to a "published musical composition" entitled "Happy Birthday to You" and the listing under the byline is as follows: "By Mildred J. Hill, arr. by Preston Ware Orem; with words." The certificate further states: “(© is claimed on arrangement as easy piano solo with text).” ... All of this, as well as the validity of the copyright, is prima facie presumed true in this litigation. The parties have agreed to a schedule that has discovery on the copyright issue continuing through to September 2014. Once evidence is collected, the two sides will submit motions arguing their case in November. ArtsTechnica say that the parties appear to have agreed to litigate the copyright validity issue on the papers, without a trial.

Currently sound recordings in the USA created before February 15th 1972 fall outside of the federal Copyright Act. And now the owners of sound recordings CAN collect royalties for their use on satellite radio and Internet radio services like SiriusXM, this matters - and collection society Sound Exchange estimated that it could collect 15% or so more than the $590 million it collected in 2013 if the recordings were covered. In 2011, the U.S Copyright Office issued a report recommending Congress take action to change this, but so far, nothing’s happened. Except in Tennessee! State Senator Stacey Campfield decided to act, saying “The music industry—they came to me and said, ‘We’re not getting our royalties.’ They said it’s something that could have a big impact,” who has now introduced the “Legacy Sound Recording Protection Act” (SB/HB 2187) with Rep. G.A. Hardaway (D-Memphis) to close the federal loophole in Tennessee. 
Whilst on first reading "The bill seems quite reasonable" and it seems most of its language is copied directly from federal copyright law, there have been some comments on the narrowness of the bill. Attorney Brandon Butler told Metro Pulse “The bill is strikingly one-sided. It gives rights-holders even more power than they have under federal law, but it gives the public, including libraries, journalists, and even other artists, none of the reuse rights that federal law includes” adding “The law is likely unconstitutional because it lacks fair-use protections” . The Bill also fails to include any provisions related to the first sale doctrine, which might mean that the musical state becomes the only place in the USA where record shops cannot re-sell second hand LPs, with University of Tennessee Law School professor Gary Pulsinelli saying that if the Bill is passed as is, “It’s entirely possible a court would say that you can’t sell music recorded before 1972”. The draft Bill was provided to Senator Campfield by 'sometime' music industry lobbyist and copyright owner Tony Gottlieb, and has yet to reach a committee in either the House or the Senate in Tennessee.

Back to Trinidad and Tobago - whose rival collection societies graced these web pages not two weeks ago. Now it seems the newer of the two music collection societies, the Trinidad and Tobago Copyright Collection Organisation (TTCO), has threatened legal action against the National Carnival Commission (NCC) for $6 million worth of outstanding royalties owed to its members over the past six years. Speaking to the Trinidad Express, NCC chairman Allison Demas said her organisation, through attorneys, had written to the TTCO on the matter back in February 2013 but to date no response has been forthcoming. “They still have not answered all the questions posed. Our attorney requested a meeting last year. They never responded, and again we await to get a response this year from the TTCO” Demas said.

Joe Walsh
An eclectic 'supergroup' of Sting, Steven Tyler and Britney Spears , Don Henley, Ozzy Osbourne, deadmau5, Mick Fleetwood and Joe Walsh are among artists fighting copyright law reforms that would allow mashups without their permission. The may represent different music styles, but they are united in telling the U.S. Patent and Trade Office that artists, who write and make music, not copyright law, should determine who has rights to make remixes, sampling and mashups that include their songs. 
The artists were joined by letters filed in support of copyright stakeholder groups including the Copyright Alliance, ASCAP, BMI, the National Music Publishers Association, Writers Guild of America West and the Motion Pictures Association of America. The Eagle's Henley said: "As a songwriter and recording artist, I can tell you that approval over how my music is used is very important to me," adding "Every song I write is personal and has meaning to me. A sample or a remix takes a piece of art, cuts it up and then either reassembles it into something different or combines it with another person's work." The USPTO questioned whether existing copyright law needed to be updated to reflect innovation in the digital economy in a task force report last year and asked for comments on a large number of different copyright issues, including the question of mashups.

Mike Weatherley MP
If you wondered what the UK Prime Minister's advisor on IP thinks about online piracy, web blocking, the role of Google in protecting the interests of copyright owners, and custodial sentences for online piracy, Mike Weatherley, the conservative MP for Hove, has given an interview to CMU Daily's Business Editor Chris Cooke and you can read it all here.

Further to John's very clear report on the breaking news in the Svensson decision, over on the IPKat Eleonora has been having more of a ponder, and has now posted her "Early Thoughts On Svensson: communication/making available, new public,altering the scope of exclusive rights" - all this  - AND a great presentation for the joined BLACA and IPKat (very busy) copyright seminar chaired by Sir Colin Birss with Bird & Birds' Graham Smith on Wednesday night- Are Moral Rights Human Rights? - something this blogger now knows more about - but still doesn't know the answer to! Anyway, I digress, Eleonora on Svensson is well worth a read. 

And finally - shame on London: Viviane Reding, the EU's Justice Commissioner, has had clothing, jewellery and a cottage pie stolen from a locked official car in Mayfair after she attended debate at the Royal Institution. The cottage pie, apparently purchased to show European colleagues just how good British cooking can be, seems to have been judged the greatest loss. And the fact that rather important EU paperwork was completely ignored and was the only thing left behind by the thief brings a smug British grin on my face and can I ask - what does that say about the UK's views on the EU?! Eeeek.

Svensson - it's all about the "new public"

The much-anticipated (not least by this blog) decision in Svensson is out!

The CJEU has created a brilliant finesse in order to answer the question in a manner which is consistent with the existing acquis.

So the core answers to the referring court's questions are as follows:

1. Article 3(1) of Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, must be interpreted as meaning that the provision on a website of clickable links to works freely available on another website does not constitute an ‘act of communication to the public’, as referred to in that provision.

2. Article 3(1) of Directive 2001/29 must be interpreted as precluding a Member State from giving wider protection to copyright holders by laying down that the concept of communication to the public includes a wider range of activities than those referred to in that provision.

The court holds that, while a link is an act of making available, where a work is already accessible on the open internet, then that act of making available does not require the consent of rightsholders because it is not a new public.

They go on to say that if you are linking to something that is, for example, normally behind a registration or other barrier so not generally available, that would be something that requires consent: "On the other hand, where a clickable link makes it possible for users of the site on which that link appears to circumvent restrictions put in place by the site on which the protected work appears in order to restrict public access to that work to the latter site’s subscribers only, and the link accordingly constitutes an intervention without which those users would not be able to access the works transmitted, all those users must be deemed to be a new public, which was not taken into account by the copyright holders when they authorised the initial communication, and accordingly the holders’ authorisation is required for such a communication to the public. This is the case, in particular, where the work is no longer available to the public on the site on which it was initially communicated or where it is henceforth available on that site only to a restricted public, while being accessible on another Internet site without the copyright holders’ authorisation."

The Court also has something to say about embedding and framing - although at first reading, this blogger is not clear exactly what the court is trying to say (and maybe this is something that is lost in translation).

28 Therefore, since there is no new public, the authorisation of the copyright holders is not required for a communication to the public such as that in the main proceedings.

29 Such a finding cannot be called in question were the referring court to find, although this is not clear from the documents before the Court, that when Internet users click on the link at issue, the work appears in such a way as to give the impression that it is appearing on the site on which that link is found, whereas in fact that work comes from another site.

This appears to be saying that, even if something is embedded, it is still not being communicated to a new public - although clearly that leaves open the possibility of other claims such as passing off or unfair competition, where an embedded link is held out as being associated with the linking site.

The Australian Law Reform Commission officially recommends adoption of fair use

The long-awaited report by the Australian Law Reform Commission into the adequacy of Australia's copyright exceptions has finally landed! After more than two years work, over 1000 submissions and over 100 consultations with stakeholders, the full 478 page report is available here. Those who aren't quite so copy-keen might dip into the summary here.

We are still digesting the full implications, but the centrepiece is the recommendation that Australia introduce a flexible 'fair use' style exception. After considering reams of evidence as to the pros and cons of such an exception, the Commission recommends fair use as a way of encouraging public interest and transformative uses, as well as innovation, while respecting authors and rightholders. 

Under the proposed framework, determining whether a use is 'fair' requires the balancing of the same four factors as those that underpin the US fair use doctrine, ie:
  1. the purpose and character of the use;
  2. the nature of the copyright material;
  3. the amount and substantiality of the part used; and
  4. the effect of the use upon the potential market for, or value of, the copyright material.
A more extensive (non-exhaustive) list of illustrative purposes than appears in the US statute is also recommended for inclusion. It covers:
  1. research or study;
  2. criticism or review;
  3. parody or satire;
  4. reporting news;
  5. professional advice;
  6. quotation;
  7. non-commercial private use;
  8. incidental or technical use;
  9. library or archive use;
  10. education; and
  11. access for people with disability.
The new exception would be accompanied by repeal of a number of the existing purpose based exceptions, including all varieties of fair dealing.

If the recommendation to implement fair use is not adopted by the legislature, the ALRC has recommended that fair dealing be amended to cover a wider range of purposes, namely the illustrative purposes set out above.

However, Aussies shouldn't rush out to exercise their fair use rights to forward emails, quote their favourite authors, back-up their legitimately purchased content, or start a search engine. In tabling the report Attorney-General George Brandis described the proposal to implement fair use as 'controversial', and stated that, 'in considering the recommendations, we will be particularly concerned to ensure and we will approach the consideration of the report with the view that no prejudice be caused to the interests of rights holders and creators' (as reported in ZDnet here). That doesn't sound as if legislation is likely to follow any time soon.

We'll keep you posted about the Government's full response to the report once it becomes available.